lipped from: https://www.thehindubusinessline.com/markets/lic-says-sitting-on-investment-gains-in-adani-group-co-stocks/article66450212.ece
LIC’s statement comes amid Adani Group’s stocks getting battered after Hindenburg Research released report alleging lapses in corporate governance and financial management
Life Insurance Corporation of India (LIC) said it is sitting on an investment gains in Adani group companies’ stocks, with ₹30,127 crore being the total purchase value acquired over the past many years, and the current market value at ₹56,142 crore as on January 27.
The state-owned life insurance behemoth’s statement comes in the wake of Adani Group companies stocks getting battered after US-based short-seller Hindenburg Research released a report on January 25 , alleging stock manipulation in these stocks, lapses in corporate governance, and financial management in the Group.
Read also: LIC reviews Adani response to short seller’s allegation
Questions were raised on LIC’s exposure to the Adani group with some analysts claiming that LIC continued to invest in these companies despite concerns raised about the business earlier. It had also taken a political colour with the opposition parties seeking an investigation. Communist Party of India leader Sitaram Yetchury tweeted on January 27th “These allegations, if true, will destroy lives of crores of Indians who park lifelong savings in LIC & SBI. LIC has ₹74,000 Crore in Adani companies & 40 per cent of its borrowings from state owned Banks are through SBI. People’s security must be safeguarded not cronies.”
LIC, in a statement, clarified that it’s total holding under equity and debt is ₹ 35,917.31 crore as on December 2022 under Adani group of companies.
“The total amount invested under Adani Group amounts to ₹36,474.78 crores as on date. These investments have however been made over a period,” per the statement.
LIC emphasised that the credit rating of all the Adani debt securities held by LIC are AA and above which is in compliance with the IRDAI investment regulations as applicable to all the Life Insurance companies.
The total Assets Under Management (AUM) by LIC were over ₹41.66 lakh crore as at September 30, 2022.
Therefore, LIC’s exposure in the Adani group, as on date, is 0.975 per cent of of its total AUM at book value,” the life insurer said.
The insurer underscored that while the market value of assets can change in either direction, it invests from a long-term perspective and based on detailed due diligence.
The available solvency margin of LIC as at September 2022 was well above the target solvency level of 160 per cent, it added.